The Income Tax Appellate Tribunal (ITAT), Hyderabad Bench, stated that the assessing officer must review the documents produced during the proceedings and concluded that the Foreign Tax Credit (FTC) cannot be denied due to the late filing of Form 67.
The case is that the taxpayer, Rupesh Kumar Rasiklal, proposed to pay tax on dividend income which was earned by him in the United States of America (USA), on which taxes were withheld, and therefore, he claimed Foreign Tax Credit (FTC) u/s 90 of the Income Tax Act read with the provisions of the Indo-USA Double Tax Avoidance Agreement (DTAA). The claim was not considered because the Form 67 was not filed within the mentioned duration.
The case was appealed before the Commissioner of Income Tax (Appeals) [CIT(A)], who upheld the refusal of FTC for the reason that the said claim was not accepted on an application submitted by him u/s 154. When expressed before the ITAT, the taxpayer’s counsel said that filing of Form 67 is merely a procedural provision mentioned under Rule 128 of the Income Tax Rules, 1962.
The tribunal discovered that the refusal of FTC is based only on the fact that Form 67 was not submitted within the time limit and held that the benefit must not be refused only based on delay. Accordingly, the tribunal directed the AO to grant the FTC where the substantive conditions were satisfied.
The bench of Madhusudan Sawdia (Accountant Member) and Ravish Sood (Judicial Member) stated that Rule 128 is a machinery provision deliberated to regulate the process to claim FTC and the same cannot override the substantive relief available u/s 90 of the Income Tax Act. On 24.07.2026, the appeal was allowed.
| Case Title | Rupesh Kumar Rasiklal Mehta vs. DCIT |
| Case No. | ITA 2280/HYD/2025 |
| For Petitioner | CA Lakshita Gudniye |
| For Respondent | SR-AR Mohan Babu |
| Hyderabad ITAT | Read Order |
